In the market for fertilizer, firms are producing output but are currently making economic losses, and the market is perfectly competitive.
Below is a detailed explanation:Perfect Competition is a type of market structure in which a large number of small firms compete to sell identical products to a large number of buyers. In the short run, perfectly competitive firms can make profits or losses, and in the long run, firms will only earn normal profits, meaning they will break even.Market for fertilizer is a perfectly competitive market because there are many small firms that produce fertilizers, and they produce the same type of fertilizer. Therefore, fertilizer companies cannot influence the price of fertilizers in the market, and they must accept the prevailing market price.Suppose firms in the fertilizer market are making economic losses. In that case, it means that the market price of fertilizer is below the average cost of producing fertilizer. When this happens, firms are not making enough revenue to cover their variable costs, fixed costs, and earn a profit.The fertilizer companies will exit the market in the long run if they continue to make economic losses. As a result, the supply of fertilizer in the market will decrease, causing the market price of fertilizer to increase. In the long run, firms in the market will earn normal profits, and the market will be in equilibrium.
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1. Discuss strict liability in Mexico oil spills
Answer:
Strict liability refers to a legal principle that holds a party responsible for damages or injuries caused by their actions or products, regardless of fault or negligence.
Explanation:
In the context of Mexico and oil spills, strict liability can play a significant role in holding responsible parties accountable for environmental damage and ensuring that affected parties are adequately compensated.
Mexico has a legal framework that addresses environmental issues, including regulations and laws related to oil spills. The Ley General del Equilibrio Ecológico y la Protección al Ambiente (General Law on Ecological Equilibrium and Environmental Protection) is the primary legislation governing environmental protection in Mexico. Additionally, Mexico has signed international conventions such as the International Convention on Civil Liability for Oil Pollution Damage (CLC) and the International Oil Pollution Compensation Funds (IOPC Funds).
Under Mexican law, strict liability for oil spills typically applies to the responsible party, such as the owner or operator of an oil facility or the party in control of the vessel involved in the spill. This means that these parties can be held liable for damages caused by an oil spill, regardless of their intent or level of negligence. Strict liability imposes a legal duty on these parties to prevent spills and take necessary measures to mitigate the environmental impact if a spill occurs.
The legal consequences and penalties for oil spills in Mexico can be severe. In addition to the requirement to clean up and remediate the affected areas, responsible parties may face fines, civil liability claims, criminal charges, and other legal actions. The government agencies responsible for overseeing environmental matters, such as the Secretaría de Medio Ambiente y Recursos Naturales (SEMARNAT) and the Agencia de Seguridad, Energía y Ambiente (ASEA), play a crucial role in enforcing the applicable regulations and ensuring that responsible parties are held accountable.
It is important to note that each oil spill incident may have its own unique circumstances, and the specific legal actions and liabilities can vary depending on the situation. Therefore, it is crucial for the parties involved to consult with legal experts familiar with Mexican environmental laws to fully understand their rights, obligations, and potential liabilities in cases of oil spills.
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that calculates the percentage difference between averagepricereceived and the unitprice in the products table. name this field percentpricedifference.
To calculate the percentage difference between average price received and the unit price in the products table, follow the below steps:
To find the percentage difference, subtract the average price received from the unit price and divide by the average price received. Multiply the result by 100 and assign it to a new column called percent price difference. The query for this will be as follows: SELECT *, ((unit price - average price received) / average price received) * 100 AS percent price difference FROM products;
Therefore, substituting the values of A and B in the above formula, we get: Percentage difference = ((unit price - average price received) / average price received) x 100Multiplying the result obtained in the above formula by 100 gives us the percentage difference between the two values, which is then assigned to a new column called percent price difference using the AS keyword in the SQL query.
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how many standard hours are allowed in may, when 800 field models and 900 professional binoculars are manufactured?
In May, a total of 800 field models and 900 professional binoculars were manufactured. The number of standard hours allowed for this production cannot be determined without additional information.
The number of standard hours allowed for production depends on various factors such as the specific manufacturing process, the time required to produce each unit, and the predetermined labor standards set by the company. Without knowing the standard hours allocated per unit for the field models and professional binoculars, it is not possible to calculate the total standard hours allowed for May . To determine the standard hours allowed, one would need to know the standard time required to manufacture each unit of the field models and professional binoculars. This information would allow for the calculation of the total standard hours based on the number of units produced.
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how do changing tax rates affect the timing strategy? what information do you need to determine the appropriate timing strategy when tax rates change?
Changing tax rates can have implications for timing strategies, particularly in the context of tax planning and decision-making. The appropriate timing strategy when tax rates change depends on various factors, including the nature of the tax change, the specific tax provisions, and the financial circumstances of the entity or individual involved.
When tax rates change, it can impact the timing strategy of certain financial decisions. For example, if tax rates are expected to increase in the future, individuals or businesses may choose to accelerate certain deductible expenses or defer taxable income to take advantage of the current lower rates. Conversely, if tax rates are anticipated to decrease, it may be beneficial to defer deductible expenses or accelerate taxable income to maximize tax savings. The appropriate timing strategy will depend on a range of factors, including the specifics of the tax change, the relevant tax provisions, and the individual or entity's financial situation. It is crucial to consider these factors and consult with tax professionals to determine the most appropriate timing strategy in light of changing tax rates.
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Assume that you are a team of graduate accountants working for BluePrint Pty Ltd, a public accounting firm situated at 297 York Street, Sydney, NSW 2000. The Manager of your firm, Mr. Aaron Mazars has asked you to prepare a statement of advice in response to various emails received from the firm’s clients raising several accounting issues. Please see the issues on the next page.
Client 3 (BKL Group Ltd) Re. Presentation/Disclosure of Non-controlling interest BKL Ltd is preparing its consolidated financial statements for the year ended 30 June 2021. The directors are wondering how non-controlling interest will be disclosed in their consolidated financial reports. On 1 July 2020, BKL Ltd purchased 70% of the shares of Subsidiary Ltd for $160,000. At the acquisition date, Subsidiary Ltd had issued capital of $100,000 and retained earnings of $100,000. Note: Goodwill was calculated as $20,000 using a full goodwill method. During 2020/21 financial year, • BKL Ltd and Subsidiary Ltd recorded profits of $100,000 and $50,000 respectively. • BKL Ltd sold inventory with a cost of $5,000 to Subsidiary for $$9,000. 80% of this inventory was still on hand of Subsidiary on 30 June 2021. • Subsidiary Ltd adapted a fair valuation method and increased its Land value by $15,000. • On 30 June 2021, both BKL Ltd and Subsidiary Ltd declared dividend of $10,000. The directors at BKL asked for your help with completing the consolidated financial statements. How should non-controlling interest be recorded on financial statements? Help the director to identify all affected financial statements and sections of the financial statements with non-controlling interest amounts.
To properly address the issue raised by BKL Group Ltd regarding the presentation and disclosure of non-controlling interest in their consolidated financial statements, I would provide the following statement of advice:
Dear Directors of BKL Group Ltd,
Regarding the preparation of the consolidated financial statements for the year ended 30 June 2021, we have reviewed the information provided and are pleased to assist you in completing the consolidated financial statements, specifically in relation to the presentation and disclosure of non-controlling interest.
Non-controlling interest refers to the portion of equity in a subsidiary that is not attributable to the parent company. In your case, BKL Ltd acquired 70% of the shares of Subsidiary Ltd on 1 July 2020. Therefore, BKL Ltd holds a controlling interest of 70% in Subsidiary Ltd, while the remaining 30% represents the non-controlling interest.
The following key points need to be considered in recording non-controlling interest in the consolidated financial statements:
1. Goodwill Calculation:
- Goodwill represents the excess of the consideration transferred over the fair value of identifiable net assets acquired. In this case, goodwill was calculated as $20,000 using a full goodwill method.
2. Share of Profits:
- BKL Ltd recorded a profit of $100,000, and Subsidiary Ltd recorded a profit of $50,000 during the financial year 2020/21.
- The share of profits attributable to the non-controlling interest should be separately presented in the consolidated statement of comprehensive income. In this case, the non-controlling interest's share of profits from Subsidiary Ltd would be $15,000 ($50,000 x 30%).
3. Intercompany Transactions:
- BKL Ltd sold inventory with a cost of $5,000 to Subsidiary Ltd for $9,000 during the financial year.
- As 80% of this inventory was still on hand of Subsidiary Ltd on 30 June 2021, the unrealized profit on intercompany transactions needs to be eliminated from the consolidated financial statements.
4. Fair Valuation:
- Subsidiary Ltd adapted a fair valuation method and increased its Land value by $15,000.
- The fair value adjustment should be recognized in the consolidated financial statements, with the non-controlling interest's share of the adjustment disclosed.
5. Dividends:
- Both BKL Ltd and Subsidiary Ltd declared dividends of $10,000 on 30 June 2021.
- The non-controlling interest's share of dividends should be separately presented in the consolidated statement of changes in equity.
Based on the information provided, the affected financial statements and sections of the financial statements with non-controlling interest amounts are as follows:
1. Consolidated Statement of Comprehensive Income:
- Non-controlling interest's share of profits from Subsidiary Ltd should be separately presented.
2. Consolidated Statement of Financial Position:
- Non-controlling interest should be presented as a separate component of equity, reflecting the non-controlling interest's proportionate share of Subsidiary Ltd's net assets.
3. Consolidated Statement of Changes in Equity:
- Non-controlling interest's share of dividends should be separately disclosed.
We recommend engaging with a professional accountant to ensure the accurate preparation of the consolidated financial statements in accordance with the relevant accounting standards and regulatory requirements.
Please note that this advice is based on the information provided, and any changes or additional information may impact the final presentation and disclosure of non-controlling interest in the consolidated financial statements.
Should you require further clarification or assistance, please do not hesitate to contact us.
Kind regards,
[Your Name]
[Your Position]
BluePrint Pty Ltd
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Question 9 1 pts Suppose there are only two firms in an economy: Rolling Rawhide produces rawhide and sells it to Chewy Chomp Inc., which uses the rawhide to produce and sell dog chews. With each $1 worth of rawhide that it buys from Rolling Rawhide. Chewy Chomp. Inc. produces a dog chew and sells it for $2.50. Neither firm had any inventory at the beginning of 2014. During that year, Rolling Rawhide produced enough rawhide for 2000 dog chews. Chewy Chomp, Inc. bought 90% of that rawhide for $1800 and promised to buy the remaining 10% for $200 in 2015. Chewy Chomp, Inc. produced 1800 dog chews during 2014 and sold each one during that year for $2.50. What was the economy's GDP for 2014? $3,800 $4,500 $4,700 $5,000
The correct option is B) $4,500 :The economy's GDP for 2014 can be calculated by using the formula GDP = C + I + G + (X − M).
Where,C is the total consumption,I is the total investment,G is the government spending,X is the total exports,M is the total imports.In the given question, there are only two firms, Rolling Rawhide and Chewy Chomp Inc., in the economy, where Rolling Rawhide produces rawhide and sells it to Chewy Chomp, Inc. Chewy Chomp, Inc. uses the rawhide to produce and sell dog chews.
For every $1 worth of rawhide that it buys from Rolling Rawhide, Chewy Chomp, Inc. produces a dog chew and sells it for $2.50.Rolling Rawhide produced enough rawhide for 2000 dog chews during 2014. Chewy Chomp, Inc. bought 90% of that rawhide for $1800 and promised to buy the remaining 10% for $200 in 2015.Chewy Chomp, Inc. produced 1800 dog chews during 2014 and sold each one during that year for $2.50.
So, the total consumption for 2014 is equal to the total sales of Chewy Chomp, Inc., which is the sum of the total sales of 1800 dog chews i.e.,
$2.50 × 1800 = $4500.
Hence, the economy's GDP for 2014 is $4,500.
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Mission Y entered into a finance lease for some machinery on 1 January 20x2. The fair value of the leased machinery is $100,000 and in return for 3 years use of the asset, the agency must pay the leasing company $40,210 per year on the last day of the year. The agency uses the actuarial method to allocate finance costs and the effective interest rate on the lease is 10%. The amount included in non-current liabilities in the agency's statement of financial position as of 31 December 20X2 will be: . ! 1 1 1 1 1 1
The amount included in non-current liabilities in the agency's statement of financial position as of 31 December 2022 will be $99,978.90.
Finance costs represent expenses incurred by a company, organization, or individual in order to obtain capital. Finance costs can include interest paid on loans, as well as other costs such as legal fees. Costs are the expenses that an organization incurs to maintain operations, such as salaries, rent, and utilities.
The fair value of the leased machinery is $100,000.
To use the machinery for 3 years, the company must pay $40,210 at the end of each year, which is a finance lease.
The actuarial method is used by the agency to allocate finance costs, and the lease's effective interest rate is 10 percent.
The amount in the agency's statement of financial position that is included in non-current liabilities as of 31 December 2022 is calculated as follows:
Year 1 payment = $40,210 PV of annual payment = $40,210 / (1 + 10%)1= $36,554.55
Year 2 payment = $40,210 PV of annual payment = $40,210 / (1 + 10%)2= $33,222.28
Year 3 payment = $40,210 PV of annual payment = $40,210 / (1 + 10%)3= $30,202.07
Total non-current liability as of 31 December 2022 = PV of minimum lease payments = $36,554.55 + $33,222.28 + $30,202.07= $99,978.90
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Now that we are mostly through the semester I would like you all to take a look back on all of the artists and musical movements related to Rock and Roll and discuss which artists(s) and/or movement(s) you think are most relevant to today's Music Industry and why. Please be as specific as possible and give examples to support your claims.
Please if anyone is knowledgeable, I need this class to pass. I will thumbs up your work if it is correct.
Rock and Roll is a musical genre that has evolved over time, influencing and inspiring several other genres. Several artists and movements have shaped the music industry as we know it today.
What on revolution?The artists/movements that have influenced today's music industry are The Beatles, Led Zeppelin, Nirvana, Hip-hop, and Punk Rock.
1. The Beatles: The Beatles are one of the most influential bands in the music industry. The band has inspired several musicians, songwriters, and artists over the years. The Beatles were innovative, creative, and passionate about their music.
The Beatles have also influenced several musical genres like Pop, Rock, Indie, and Alternative.
2. Led Zeppelin: Led Zeppelin was a band that had a massive influence on the rock music industry. Their unique sound and style have inspired several artists like Guns N' Roses, Foo Fighters, and Jack White.
Their iconic riffs and solos are still used as reference points by many musicians today. Led Zeppelin has also influenced several sub-genres like Heavy Metal, Glam Rock, and Grunge.
3. Nirvana: Nirvana was a band that changed the face of Rock and Roll forever. Their music was raw, emotional, and relatable. Nirvana's music was a combination of Punk, Grunge, and Alternative. Their songs spoke about personal experiences, societal issues, and mental health.
4. Hip-hop: Hip-hop is a musical genre that has grown and evolved over time. Hip-hop is a genre that has a significant influence on today's music industry.
Hip-hop has influenced several artists like Kendrick Lamar, Drake, and Kanye West. Hip-hop has also influenced several sub-genres like Trap, Drill, and Grime.
5. Punk Rock: Punk Rock is a musical genre that has a massive influence on the Rock and Roll industry. Punk Rock originated in the United States and the United Kingdom in the mid-1970s.
Punk Rock is a genre that is known for its anti-establishment lyrics, fast-paced music, and DIY ethos.
These artists/movements have inspired several other artists, sub-genres, and styles over the years. Their music, style, and message have transcended time and have left an everlasting impact on the music industry.
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Case: Levi’s strategic change and leadership (40 marks)
Chip Bergh became CEO of Levi's in 2011. He had the task of turning around a company suffering a decline in revenue of 29% from $6.8 billion in 1997 to $4.8 billion. Bergh brought Harmit Singh onboard as CFO to strategically partner for a transformation.
"When I got to Levi’s in January of 2013, Chip said to me: ‘I’ve got these strategic choices on a piece of paper, but we don't have a strategic blueprint, and we’re going to be talking to the board in six months. Harmit, I need your help to bring this strategy and build it into a road map.’" But "change doesn't happen overnight; it takes time," Harmit Singh says.
A major step was investing in accelerating the women's segment of the business. The company later decided to pursue an IPO and went public in 2019. Then the pandemic hit in 2020 and pummeled the retail industry. Bergh and Singh again worked on managing strategic change.
The company had to do much more than tweak its existing e-commerce business, which was losing money before COVID hit. The company had to invest in it, quickly and heavily. "It's now profitable because it is scaled so quickly," Bergh told Fortune in November.
In Q4 2021, Levi's earned net revenues of $1.7 billion, up 22% versus Q4 2020; up 7% compared to Q4 2019. In addition to ensuring the company survives financially, the pandemic was also a time of self-reflection, Singh says. "Even in the deepest of the troughs, I think good leaders have to start thinking about who you want to be," he says. "I've learned the importance of being empathetic as a leader."
"When I started in my career, the CFO role was about creating shareholder value," Harmit Singh, EVP and CFO of Levi Strauss & Co. said, "Today, it's about broader stakeholder value creation."
Singh’s strategic journey at the company started since he joined in 2013. "I like to be called a coach and not a boss because I like to give constructive feedback," Singh told about his leadership style. "I have a team of about 12 people. I would say none of them are doing the exact same job they started with because I like to move people around and give them a diversity of experience. That's what happened to me."
"For me, I put my responsibilities as an executive officer and a leader of the team at the forefront of my decision making," Singh explains. "I do recognize that I represent more than just my personal viewpoints when I speak publicly as leader of the company."
He says providing a forum for thoughtful discussion and debate is "a critical component" of a successful company and a leadership team. "It makes us sure that broad perspectives are considered," Singh says. He added, "I'm proud of the decisions that we as a leadership team have taken in leverage to protect the health and safety of our employees."
Questions: (each question 20 marks)
Please comment on Levi’s strategic response to the pandemic. Does Levi’s strategy fall into the prescriptive approach or emergent approach? How do you evaluate Levi’s strategic change? Please provide theoretical arguments and logical reasoning.
From a contingency perspective, please comment on the effectiveness of leadership in Levi’s strategic change. Does leadership play an essential role in the change process? Please provide theoretical arguments and logical reasoning.
Levi's strategic response to the pandemic can be seen as falling into the emergent approach. The company had to quickly adapt and invest in its e-commerce business to survive financially. They made significant changes to their existing operations and focused on scaling their online presence, which resulted in profitability.
Levi's strategic response to the pandemic aligns more closely with the emergent approach to strategy. The company had to react swiftly to the unexpected challenges posed by the pandemic, such as the decline in retail sales and the need to boost their e-commerce business. Their strategy evolved in response to the changing circumstances and market conditions. They invested heavily in their online operations and quickly scaled it up, leading to profitability. This demonstrates an adaptive and flexible approach to strategy, where decisions were made based on real-time information and the need to survive and thrive in the face of uncertainty.
From a contingency perspective, leadership played an essential role in Levi's strategic change. Chip Bergh and Harmit Singh provided the vision, direction, and guidance needed to navigate the company through the turbulent times. Their leadership style, characterized by constructive feedback, diversity of experience, and stakeholder value creation, created an environment that encouraged innovation and adaptation. By involving the leadership team in decision-making and fostering thoughtful discussions, they ensured that a variety of perspectives were considered, leading to more informed and effective strategic choices. Effective leadership is crucial in managing change because it sets the tone, motivates employees, and facilitates the alignment of efforts toward common goals. In the case of Levi's, the leadership's strategic acumen and ability to adapt contributed to the success of their change initiatives and the company's resilience in the face of the pandemic.
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when selling a business, the purpose of a due diligence period is to allow the buyer to
When selling a business, the purpose of a due diligence period is to allow the buyer to conduct a thorough investigation and evaluation of the business before completing the purchase.
1. Assessing the accuracy of the information provided by the seller: The buyer wants to verify the claims made by the seller regarding the business's financial performance, assets, liabilities, customer base, market position, intellectual property, and other relevant aspects.
2. Identifying potential risks and liabilities: The buyer wants to uncover any hidden risks, potential legal or regulatory issues, pending litigation, environmental concerns, or any other factors that could impact the business's future performance or expose the buyer to unforeseen liabilities.
3. Evaluating the synergy and fit with the buyer's objectives: The buyer wants to ensure that the acquisition aligns with their strategic goals and objectives. They will assess how the acquired business will integrate with their existing operations, whether it complements their product or service offerings, and if it brings any competitive advantages.
4. Determining the valuation and negotiating terms: The due diligence process helps the buyer in valuing the business accurately. By reviewing the financial records, contracts, and other relevant information, the buyer can determine the fair market value of the business and negotiate the terms of the deal based on their findings.
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This is HR management, but the closest thing I could use was operations.
Under what conditions do you think it is okay for a college student who has accepted an internship offer to back out of the agreement? Do you think you might ever do so? Why or why not?
How might companies respond if an intern reneges after accepting an offer? What might they do to prevent this from happening? Should they use ‘carrots’ or ‘sticks’ to ensure that accepted offers are honored?
If you were a hiring manager who learned that a candidate you are considering hiring had reneged on an offer in the past, how would that influence your opinion of the individual?
Under what conditions do you think it is okay for an employer to renege on an offer that has been accepted by an intern? How would this action influence your opinion of that company as an employer in the future?
It is generally acceptable for a college student to back out of an internship agreement if certain conditions are met, such as unforeseen personal circumstances or conflicting opportunities that significantly impact their ability to fulfill the commitment.
Companies may respond to intern reneges by implementing preventive measures such as clear communication, realistic expectations, and possibly using incentives ('carrots') or consequences ('sticks'). Learning that a candidate reneged on an offer in the past may influence a hiring manager's opinion but should be considered in the context of the specific circumstances. Employers should only renege on an offer accepted by an intern in exceptional situations, and such actions may negatively impact their reputation as an employer.
College students may need to back out of an internship agreement if they face unforeseen personal circumstances (e.g., health issues, family emergencies) or encounter better opportunities that align with their career goals. However, it is crucial for students to communicate their decision promptly and professionally to minimize any negative impact on the employer.
Companies can respond to intern reneges by implementing preventive measures. Clear communication about expectations and potential consequences can help interns understand the importance of commitment. Realistic job previews and structured onboarding programs can give interns a better understanding of the role and help them make informed decisions.
When considering a candidate who reneged on an offer in the past, the hiring manager should evaluate the circumstances surrounding that decision. It is essential to consider factors like the timing, reasons, and level of professionalism displayed during the reneging process.
Employers should renege on an accepted offer only in exceptional circumstances, such as severe financial difficulties or unforeseen business constraints. However, such actions may negatively impact the employer's reputation, making it harder to attract future talent.
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How could you use the Curphy and Roellig Followership model described in the introduction to Part 3 to assess employees at the casino?
The Curphy and Roellig Followership model can be used to assess employees at the casino by evaluating their followership behaviors and characteristics. The model identifies five dimensions of effective followership: critical thinking, active engagement, independent thinking, self-management, and courageous followership.
To assess employees at the casino using this model, you can design evaluation criteria and performance indicators based on these dimensions. For example:
Critical Thinking: Assess employees' ability to analyze situations, make informed decisions, and provide constructive feedback or suggestions.
Active Engagement: Evaluate employees' level of involvement, enthusiasm, and commitment to their work and the organization.
Independent Thinking: Measure employees' initiative, creativity, and ability to work autonomously, taking ownership of their tasks and responsibilities.
Self-Management: Assess employees' organizational skills, time management, and ability to prioritize tasks effectively.
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Lane Industries is considering three independent projects, each of which requires a $1.6 million investment. The estimated internal rate of return (IRR) and cost of capital for these projects are presented here:
Project H (high risk): Cost of capital = 12% IRR = 14%
Project M (medium risk): Cost of capital = 11% IRR = 9%
Project L (low risk): Cost of capital = 7% IRR = 8%
Note that the projects' costs of capital vary because the projects have different levels of risk. The company's optimal capital structure calls for 40% debt and 60% common equity, and it expects to have net income of $3,500,000. If Lane establishes its dividends from the residual dividend model, what will be its payout ratio? Round your answer to 2 decimal places.
_____________%
To determine Lane Industries' payout ratio, we need to calculate the total dividends paid out to common equity shareholders. The payout ratio is defined as the ratio of dividends to net income. Here's how we can calculate it:
Net Income = $3,500,000
Since the company follows the residual dividend model, it first covers its financing needs and then distributes the remaining funds as dividends. Given that the optimal capital structure is 40% debt and 60% common equity, we need to calculate the financing needs and subtract them from the net income.
Financing Needs = Total Investment - Equity Portion
= $1,600,000 - (0.60 * $1,600,000)
= $1,600,000 - $960,000
= $640,000
After covering the financing needs, the remaining funds are available for dividends:
Available Dividends = Net Income - Financing Needs
= $3,500,000 - $640,000
= $2,860,000
Now we can calculate the payout ratio:
Payout Ratio = Dividends / Net Income
= Available Dividends / Net Income
= $2,860,000 / $3,500,000
= 0.8171 (rounded to four decimal places)
Therefore, the payout ratio is 81.71%.
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trace the causes that led to financial collapse in industries and high unemployment. arrange the events in order, starting with the first event on top.
The causes that led to a financial collapse in industries and high unemployment can be traced to a series of interconnected events. These events include speculative bubbles, unsustainable borrowing, financial market instability, economic downturns, and subsequent layoffs. The sequence of events starts with the formation of speculative bubbles, followed by a burst in the bubble, leading to a decline in asset values and financial market instability. This, in turn, results in economic downturns, reduced business activity, and companies facing financial distress. As a consequence, companies lay off workers, leading to high unemployment rates.
The first event in the sequence is the formation of speculative bubbles, where asset prices, such as housing or stock markets, become overvalued due to excessive optimism and investor speculation. This creates an environment of inflated asset values and borrowing. However, as the bubble bursts, asset values decline rapidly, leading to financial market instability.
Financial market instability contributes to the second event, which involves economic downturns. The decline in asset values leads to reduced consumer and investor confidence, resulting in decreased spending and investment. This contraction in economic activity affects industries across sectors, leading to reduced revenues, profitability, and financial distress for companies.
Financial distress in companies leads to the third event, which involves layoffs and high unemployment. In order to cut costs and survive the economic downturn, companies resort to downsizing and workforce reduction. This results in increased unemployment rates as job opportunities become scarce.
The causes of financial collapse in industries and high unemployment can be traced back to the formation and burst of speculative bubbles, financial market instability, economic downturns, and subsequent layoffs. These events create a vicious cycle where the weakening economy exacerbates financial distress, leading to further layoffs and a prolonged period of high unemployment.
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Susan lives on an island economy and consumes only coconuts. Her utility function is given by u = √C, where is the number of coconuts she consumes. a. Find her utility from consuming 17 coconuts. Do not include the label in your answer; just give the number. Round your answer to the first decimal point. b. Find her marginal utility of consuming her 17th coconut. Do not include the label in your answer; just give the number. Round your answer to the first decimal point.
Her utility from consuming 17 coconuts is approximately 4.1. Her marginal utility of consuming her 17th coconut is approximately 0.1.
To find Susan's utility from consuming 17 coconuts, we can use her utility function u = √C, where C is the number of coconuts consumed.
Substituting C = 17 into the utility function:
u = √17 ≈ 4.1
Rounding to the first decimal place, her utility from consuming 17 coconuts is approximately 4.1.
b. Her marginal utility of consuming her 17th coconut is approximately 0.1.
The marginal utility represents the additional utility Susan gains from consuming one additional coconut. To find the marginal utility of the 17th coconut, we can take the derivative of the utility function with respect to the number of coconuts consumed (C) and evaluate it at C = 17.
The utility function is given as u = √C.
Taking the derivative with respect to C:
∂u/∂C = 1/(2√C)
Substituting C = 17:
∂u/∂C = 1/(2√17) ≈ 0.1
Rounding to the first decimal place, her marginal utility of consuming her 17th coconut is approximately 0.1.
a. Susan's utility from consuming 17 coconuts is approximately 4.1.
b. Her marginal utility of consuming her 17th coconut is approximately 0.1.
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The capital balances of the partners in DEB Co. are M. Ditka $40,000; E. Embs $30,000; and B. Boyd $20,000. The partners share income equally. Boyd decides that he is going to leave the partnership. Ditka and Embs each agree to pay Boyd $12,000 from their personal assets to each receive 50% of Boyd's equity. Journalize the withdrawal of Boyd on December 31 of the current year.
December 31 of the current year is: Cash Account is debited with $24,000, Ditka Capital Account is credited with $12,000, and Embs Capital Account is credited with $12,000. This is because Ditka and Embs agree to pay Boyd $12,000 each from their personal assets to each receive 50% of Boyd's equity.
In the current scenario, the capital balances of the partners in DEB Co. are M. Ditka $40,000, E. Embs $30,000, and B. Boyd $20,000. The partners share income equally. Boyd decides that he is going to leave the partnership. Ditka and Embs each agree to pay Boyd $12,000 from their personal assets to each receive 50% of Boyd's equity. Now, the journalizing of the withdrawal of Boyd on December 31 of the current year is given as:First, let us calculate the total capital balances of all three partners before the withdrawal of Boyd:
Total Capital = Capital of Ditka + Capital of Embs + Capital of Boyd
= $40,000 + $30,000 + $20,000= $90,000
Now, let us calculate the new capital balances of Ditka and Embs, who are remaining partners after Boyd’s withdrawal: Capital of Ditka after withdrawal
= $40,000 + $12,000 = $52,000
Capital of Embs after withdrawal
= $30,000 + $12,000 = $42,000
It is given that Ditka and Embs have agreed to pay Boyd $12,000 each to each receive 50% of Boyd’s equity. So, Boyd’s total equity
= $12,000 + $12,000 = $24,000
Now, let’s journalize the withdrawal of Boyd on December 31 of the current year .Partnership Withdrawal Journal Date Account Titles and Explanation PR Debit Credit Dec. 31 Cash (12,000 + 12,000) 24,000 Ditka, Capital 12,000 Embs, Capital 12,000 (To record the withdrawal of Boyd's equity)
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As modern states formed, rights were extended through laws and enforcement mechanisms that provided greater legal protections to an increasingly wider range of rights concerns (Barbalet, 1988; Foweraker & Landman, 1997).
i) What do you understand by the meaning of Human Rights? (10 Marks)
ii) Discuss three (3) types of democracy. (60 Marks)
iii) As a Malaysian citizen and a part of democratic society, explain one (1) way how you voice out your rights in Malaysia. (20 Marks)
Another 10 marks will be from your 4 in text citation and 4 related APA references Assignment Guide
i) Explain clearly on the meaning of Human Rights
ii) Explain on three (3) types of democracy (Refer to unit 1,page 6-8).
You need to elaborate your answer with proper examples.
iii) Explain clearly with examples on way to voice out your rights in Malaysia
i) Meaning of Human Rights:
Human rights refer to the fundamental rights and freedoms that every individual is entitled to by virtue of being a human being. They are inherent, universal, and indivisible, and they aim to protect and promote the dignity, equality, and well-being of all people. Human rights include civil and political rights (e.g., freedom of speech, right to a fair trial), economic and social rights (e.g., right to education, right to healthcare), and cultural rights (e.g., right to practice one's religion). They are enshrined in international and national legal frameworks, such as the Universal Declaration of Human Rights.
ii) Types of Democracy:
Direct Democracy: In a direct democracy, citizens participate directly in decision-making processes. They have the opportunity to vote on policies and laws through referendums or initiatives. This form of democracy is characterized by active citizen involvement, where the people have direct control over the decision-making process. Examples include ancient Greek city-states and certain Swiss cantons.
Representative Democracy: Representative democracy is based on the principle of elected officials representing the interests and preferences of the citizens. People vote for their representatives who then make decisions on their behalf in legislative bodies. This form of democracy allows for broader participation and is commonly practiced in many countries, including the United States, the United Kingdom, and India.
Deliberative Democracy: Deliberative democracy emphasizes open and inclusive dialogue and discussion among citizens to reach informed and rational decisions. It focuses on public deliberation, where individuals exchange ideas, arguments, and opinions to shape collective decisions. Deliberative democracy encourages the active engagement of citizens in decision-making processes and promotes the exchange of diverse perspectives. Examples include citizens' assemblies and town hall meetings.
iii) Voicing Out Rights in Malaysia:
As a Malaysian citizen in a democratic society, one way to voice out your rights is through peaceful assembly and freedom of expression. Malaysian citizens have the right to gather in public spaces, organize protests, and express their opinions freely. For example, you can participate in peaceful demonstrations, join advocacy groups, or engage in public debates to raise awareness about issues that are important to you. Social media platforms also provide avenues for expressing opinions and sharing information. However, it's essential to exercise these rights responsibly and within the boundaries of the law.
Remember to consult credible sources, such as academic articles, books, or reputable websites, to support your answers. Cite your sources using proper in-text citations and include a reference list in APA format to provide evidence of your research. Good luck with your assignment!
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You are planning to open a new pizza restaurant in your neighborhood. To start off, you need $200,000 of an initial investment. Please describe your fundraising strategy.
The fundraising strategy for opening a new pizza restaurant with an initial investment of $200,000 would involve a combination of traditional and modern approaches.
Exploration of personal savings and assets would be the first step in raising funds. This could involve using personal savings or leveraging assets like property or vehicles to secure loans from financial institutions. Additionally, approaching local banks and credit unions for small business loans can provide a significant portion of the required investment.
Crowdfunding platforms could also be utilized to gather support from the community and potential customers. Creating an engaging campaign highlighting the unique aspects and value proposition of the pizza restaurant, offering incentives to backers, and leveraging social media can attract individuals interested in supporting local businesses.
Lastly, reaching out to potential investors who share a passion for the food industry and have experience in the restaurant business can provide additional funding and valuable expertise. Presenting a solid business plan, outlining the revenue potential, and emphasizing the competitive advantage of the pizza restaurant would be crucial in attracting potential investors.
Implementing a well-rounded fundraising strategy that incorporates multiple sources can help secure the required initial investment for the new pizza restaurant while also creating a strong foundation for future growth and success.
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Do you think that it would be easy to influence a subordinate’s
attitudes, values, or emotions? Why? Which would have the largest
influence on the employee’s behavior? Why?
Influencing a subordinate's attitudes, values, or emotions is not necessarily easy, as it depends on various factors such as the individual's personality, existing beliefs, and the nature of the relationship between the supervisor and subordinate.
However, supervisors can have a significant influence on an employee's behavior by demonstrating consistent values, providing positive reinforcement, and fostering a supportive work environment.
Influencing a subordinate's attitudes, values, or emotions can be challenging due to the complexity of human behavior and individual differences. Attitudes, values, and emotions are deeply rooted and can be influenced by a multitude of factors, including personal experiences, cultural background, and upbringing. While supervisors have the potential to influence their subordinates, the extent of that influence depends on several factors.
The relationship between the supervisor and subordinate plays a crucial role in influencing behavior. A positive and supportive relationship built on trust and respect creates an environment where subordinates are more open to influence. Supervisors can also shape attitudes and values by consistently demonstrating and reinforcing desired behaviors, providing clear expectations, and offering feedback and guidance.
Among attitudes, values, and emotions, attitudes are generally considered more susceptible to change through influence. Attitudes are evaluative judgments towards people, objects, or ideas, and they can be influenced by persuasive communication, role modeling, and consistent reinforcement. Values, on the other hand, are deeply ingrained beliefs about what is important and may be more resistant to change. Emotions are subjective experiences that can fluctuate in response to various stimuli and may be influenced to some extent but are often more challenging to directly control or alter.
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The data set below contains spending on products ($) during a three-month period by a sample of 15 customers receiving in 55.59 22.84 67.46 46.38 57.43 108.36 50.95 35.17 78.74 50.57 63.17 59.42 41.95 56.03 53.38 ***. a. Compute the mean and median. The mean is. (Round to two decimal places as needed. Do not include the $ symbol in your answer.) The median is (Round to two decimal places as needed. Do not include the $ symbol in your answer.) b. Compute the variance, standard deviation, range, and coefficient of variation. The variance is (Round to two decimal places as needed. Do not include the $ symbol in your answer.) The standard deviation is. (Round to two decimal places as needed. Do not include the $ symbol in your answer.) The range is (Round to two decimal places as needed. Do not include the $ symbol in your answer.) The coefficient of variation is %. (Round to two decimal places as needed.) c. Are the data skewed? If so, how? A. Yes, the data are right-skewed. B. No, the data are not skewed. c. Are the data skewed? If so, how? OA. Yes, the data are right-skewed. OB. No, the data are not skewed OC. Yes, the data are le-skewed OD. There is not enough information to determine the skewness of the distribution d. Based on the results of (a) through (e), what conclusions can be reached concerning spending on products by customers receiving incentives through a moble loyalty program? The average amount spent is and half the customers spent more than $ The average scatter of the amount around the mean is $ The difference between the highest amount spent and lowest amount spent is (Round to the nearest cent as needed.)
a) The mean of the spending on products is 55.70 dollars. The median of the spending on products is 56.03 dollars.
b) The variance is 558.78. The standard deviation is 23.65. The range is 85.57 dollars. The coefficient of variation is 42.48%.
c) The data are skewed right. The mean is greater than the median, which is an indication of right-skewedness.
d) From the data above, we can conclude that the average amount spent on products by the customers is $55.70. Half of the customers spent more than $56.03
.The average scatter of the amount around the mean is $23.65. The difference between the highest amount spent and lowest amount spent is $85.57. Therefore, spending on products by customers receiving incentives through a mobile loyalty program seems to be generally effective in encouraging spending.
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Sohr Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $50 to buy from farmers and $15 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $20 or processed further for $19 to make the end product industrial fiber that is sold for $58. The beet juice can be sold as is for $41 or processed further for $23 to make the end product refined sugar that is sold for $58. How much profit (loss) does the company make by processing one batch of sugar beets into the end products industrial fiber and refined sugar? Select one: a. $(107) b. $(4) C. $9 d. $13
To calculate the profit (loss) made by processing one batch of sugar beets into industrial fiber and refined sugar, let's analyze the costs and revenues associated with each step:
Cost of purchasing one batch of sugar beets: $50
Cost of crushing one batch of sugar beets: $15
Revenue from selling beet fiber: $20
Cost of processing beet fiber into industrial fiber: $19
Revenue from selling industrial fiber: $58
Revenue from selling beet juice: $41
Cost of processing beet juice into refined sugar: $23
Revenue from selling refined sugar: $58
To calculate the profit (loss), we need to subtract the total costs from the total revenues:
Total revenue = Revenue from industrial fiber + Revenue from refined sugar
= $58 + $58
= $116
Total cost = Cost of purchasing sugar beets + Cost of crushing sugar beets + Cost of processing beet fiber + Cost of processing beet juice
= $50 + $15 + $19 + $23
= $107
Profit (loss) = Total revenue - Total cost
= $116 - $107
= $9
Therefore, the company makes a profit of $9 by processing one batch of sugar beets into industrial fiber and refined sugar. The correct answer is option C. $9.
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What is the selling price of a dining room set at Macy’s? Assume actual cost is $890 and 45% markup on selling price.
The selling price of the dining room set at Macy's would be $1,290.50 which can be calculated by adding a 45% markup on the actual cost, which is $890.
To calculate the selling price with a 45% markup on the actual cost, we first need to find the markup amount. The markup is calculated by multiplying the actual cost by the markup percentage (45% in this case):
Markup = Actual Cost * Markup Percentage
Markup = $890 * 0.45
Markup = $400.50
Once we have the markup amount, we can determine the selling price by adding the markup to the actual cost:
Selling Price = Actual Cost + Markup
Selling Price = $890 + $400.50
Selling Price = $1,290.50
Therefore, the selling price of the dining room set at Macy's would be $1,290.50. This calculation accounts for the 45% markup on the actual cost of $890, resulting in the final selling price.
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Optimal investment in a startup. Let u, denote the valuation of a start-up company at time t, t= 0,1.... (say, in months). If , = 0, then the company goes bankrupt, and stops operating; if , = x, then the company is acquired by a larger company, you receive a payout ax, and the company stops operating. In each time period that the company operates, you incur an operating cost ca, and you decide whether to invest more money in the company, depending on its current value. If you decide to invest, then you invest a fixed amount c. We model the valuation as a Markov decision process: the states v₂ = 0 and v₁ = Umax are absorbing; if 0 < 0 is a given parameter. The initial valuation is an integer multiple of 5, as is , so all u, are also integer multiples of 6. With this model, you will eventually either go bankrupt or be acquired, whether you make investments or not. (a) Explain how to find an investment policy that maximizes your expected profit. (Profit is the payout, when and if the company is acquired, minus the total operat- ing cost, minus the total of any investments made.) And yes, we mean over infinite time, although any given realization will terminate in bankruptcy or acquisition in a finite number of periods. (b) Consider the instance of the problem with % = $10M, ax = $100M, P₁ = 0.60. Po = 0.50, = $10K, € = $400K, 6 = $2M. What is the optimal investment policy? Report the expected profit, the probabil- ity that the startup goes bankrupt, and the expected time until the startup goes bankrupt or is acquired, all under the optimal policy. Use Monte Carlo simulation with the optimal policy to give a histogram of the profit. Give 10 trajectories of valuation on the same plot.
Investment policy that maximizes the expected profitIn order to find an investment policy that maximizes your expected profit, the optimal policy can be used. This policy indicates the optimal investment decision at each time period based on the current state of the company.
One can calculate the value function for this model, and this gives us the expected profit that we would obtain when we follow the optimal policy. There is a recursive relationship between the value functions that can be used to compute them iteratively.
This algorithm is called value iteration and it finds the optimal policy at the same time as it computes the value function. Optimal investment policyIn the given instance, the optimal investment policy can be found by solving the Markov decision process.
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The Russian Ruble is said to be selling at a forward premium if the spot price is $0.03/P and the four month forward rate is $ /P (enter any feasible number).
The Russian Ruble is said to be selling at a forward premium if the spot price is $0.03/P and the four-month forward rate is higher than $0.03/P. A forward premium is a situation where the spot price of a currency is lower than its forward price.
It indicates that the market expects the value of the currency to rise in the future. Therefore, the forward price is higher than the spot price. The difference between the forward price and the spot price is called the forward premium. In this case, if the four-month forward rate is $0.04/P, the Russian Ruble is selling at a forward premium of $0.01/P. This implies that the market expects the value of the Russian Ruble to increase in the next four months and investors are willing to pay a higher price for it. Therefore, they are willing to pay $0.04/P for the Ruble instead of $0.03/P.
The Russian Ruble is the official currency of the Russian Federation and its symbol is ₽. It is one of the world's most traded currencies, with significant trade volumes in oil and natural gas markets. Its exchange rate is influenced by many factors, including the country's economic performance, political stability, and global market conditions. The Russian Ruble has experienced significant fluctuations in value in recent years, due to factors such as sanctions, geopolitical tensions, and the global oil market. This has made it a challenging currency for investors to predict and trade. In conclusion, if the four-month forward rate of the Russian Ruble is higher than its spot price, the Ruble is selling at a forward premium. The Russian Ruble is the official currency of the Russian Federation and is influenced by various economic, political, and global market factors. A well-written answer should be at least 160 words.
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6. Find three examples of different ways indi- vidual firms or industries can make the strategy "This offer is good for a limited time only" a credible strategy.
7. The Gizmo Company has a monopoly on the production of gizmos. Market demand is described as follows: at a price of $1,000 per gizmo, 25,000 units will be sold whereas at a price of $600, 30,000 will be sold. The only costs of production are the initial sunk costs of building a plant. Gizmo Co. has already invested in capacity to produce up to 25,000 units.
a. Suppose an entrant to this industry could capture 50 percent of the market if it invested in $10 million to construct a plant. Would the firm enter? Why or why not?
b. Suppose Gizmo could invest $5 mil- lion to expand its capacity to produce 40,000 gizmos. Would this strategy be a profitable way to deter entry?
Three examples are: setting a specific deadline, providing limited quantity, and offering exclusive bonuses or discounts.
To make the strategy "This offer is good for a limited time only" credible, firms or industries can employ different tactics. One approach is to set a specific deadline, clearly stating when the offer expires. Another way is to provide limited quantities, creating a sense of scarcity and urgency. Lastly, offering exclusive bonuses or discounts for a limited time can make the offer more enticing and credible.
In scenario (a), the potential entrant would consider the cost-benefit analysis. Since investing $10 million to capture only 50 percent of the market does not justify the cost, the firm would likely decide not to enter the industry.
In scenario (b), Gizmo Co. needs to evaluate the profitability of expanding its capacity to produce 40,000 gizmos. The decision depends on whether the additional sales generated from the expanded capacity can cover the $5 million investment. If the incremental revenue exceeds the investment cost, it would be a profitable way to deter entry. However, if the additional sales do not justify the investment, Gizmo Co. might not find it beneficial to pursue this strategy.
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The payroll register of Seaside Architecture Company indicates $940 of Social Security and $258 of Medicare tax withheld on total salaries of $16,000 for the period. Federal withholding for the period totaled $3,260. Prepare the journal entry for the period's payroll. If an amount box does not require an entry, leave it blank.
The journal entry for the period's payroll would be as follows: Debit:- Salaries Expense: $16,000, - Social Security Tax Payable: $940, - Medicare Tax Payable: $258, - Federal Income Tax Payable: $3,260
Credit:
- Cash: Total net amount paid to employees (16,000 - 940 - 258 - 3,260)
The journal entry records the expenses related to salaries, as well as the amounts withheld for Social Security, Medicare, and federal income tax. The debits reflect the amounts withheld from employees' salaries and the income tax expense, while the credits show the liabilities for the withheld taxes. The credit to cash represents the net amount paid to employees after the tax withholdings.
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The journal entry for the period's payroll would be as follows: Debit:- Salaries Expense: $16,000, - Social Security Tax Payable: $940, - Medicare Tax Payable: $258, - Federal Income Tax Payable: $3,260
Credit:
- Cash: Total net amount paid to employees (16,000 - 940 - 258 - 3,260)
The journal entry records the expenses related to salaries, as well as the amounts withheld for Social Security, Medicare, and federal income tax. The debits reflect the amounts withheld from employees' salaries and the income tax expense, while the credits show the liabilities for the withheld taxes. The credit to cash represents the net amount paid to employees after the tax withholdings.
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Yupi company is considering investing in Project A or Project B. Project A generates the following cash flows: year ""zero"" = 317 dollars (outflow); year 1 = 258 dollars (inflow); year 2 = 320 dollars (inflow); year 3 = 365 dollars (inflow); year 4 = 100 dollars (inflow). Project B generates the following cash flows: year ""zero"" = 230 dollars (outflow); year 1 = 120 dollars (inflow); year 2 = 100 dollars (inflow); year 3 = 200 dollars (inflow); year 4 = 120 dollars (inflow). The MARR is 12 %. Compute the Benefit/Cost ratio of the BEST project.
To compute the Benefit/Cost (B/C) ratio for the two projects, we need to calculate the present value (PV) of the cash flows for each project and then divide the total PV of the inflows by the total PV of the outflows. The project with the higher B/C ratio is considered the better investment option.
Let's calculate the B/C ratio for Project A:
Year 0: -317 (outflow)
Year 1: 258 / [tex](1+0.12)^{1}[/tex]
Year 2: 320 /[tex](1+0.12)^{1}[/tex]
Year 3: 365 / [tex](1+0.12)^{3}[/tex]
Year 4: 100 / [tex](1+0.12)^{4}[/tex]
Calculating the present value (PV) for each year and summing them up, we get:
PV of Project A =[tex]-317+(\frac{258}{1.12})+ (\frac{320}{1.12^{2} })+(\frac{365}{1.12^{3} }) + (\frac{100}{1.12x{4} })[/tex]
Next, let's calculate the B/C ratio for Project B:
Year 0: -230 (outflow)
Year 1: [tex]\frac{120}{(1+0.12)^{1} }[/tex]
Year 2:[tex]\frac{100}{(1+0.12)^{2} }[/tex]
Year 3: [tex]\frac{200}{(1+0.12)^{3} }[/tex]
Year 4: [tex]\frac{120}{(1+0.12)^{4} }[/tex]120 / (1 + 0.12)^4
Calculating the present value (PV) for each year and summing them up, we get:
Now, we can calculate the B/C ratio for each project:
B/C ratio of Project A = PV of Project A / (-317)
B/C ratio of Project B = PV of Project B / (-230)
After performing the calculations, we can compare the B/C ratios of the two projects to determine which one is the better investment option.
By calculating the present value of cash flows and dividing the total present value of inflows by the total present value of outflows, we can determine the Benefit/Cost (B/C) ratio for each project. The project with the higher B/C ratio is considered the better investment option.
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RECEIVABLES INVESTMENT McEwan Industries sells on terms of 3/10, net 30. Total sales for the year are $1,921,000; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 70 days after their purchases.
What is the days sales outstanding and the average amount of receivables?
What is the percentage cost of trade credit to customers who take the discount?
What is the percentage cost of trade credit to customers who do not take the discount and pay in 70 days?
What would happen to McEwan’s accounts receivable if it toughened up on its collection policy with the result that all nondiscount customers paid on the 30th day?
Days sales outstanding and the average amount of receivables: The days sales outstanding is the average amount of time taken by a company to collect the money for its goods sold.
What are the days?The days sales outstanding is calculated as follows: Days sales outstanding = (Accounts receivables / Net credit sales) * number of days.
During the year, the total sales were $1,921,000. Accounts receivables from all sales would be $1,921,000 minus the discounts taken ($1,921,000 x 0.40 x 0.03 = $23,052).Accounts receivable would be $1,897,948.Days sales outstanding = ($1,897,948 / $1,921,000) x 365 days = 36.4 days. Average amount of receivables = 60% x $1,897,948 = $1,138,769.
What is the percentage cost of trade credit to customers who take the discount?Customers who take the discount get a cost advantage of 3% for paying within 10 days, which is an annual rate of 3% x 365 days/20 days = 54.75%.
Customers who do not take the discount have a cost of 100% less the cost of the discount. This means that they will pay an annual interest rate of (100%-3%) x 365 days/70 days = 46.14%.
What would happen to McEwan’s accounts receivable if it toughened up on its collection policy with the result that all non - discount customers paid on the 30th day?McEwan Industries would collect all of its accounts receivable 40 days sooner than it currently does. This would increase the cash available to the company by the amount of accounts receivable that would have been collected during the 40 days.
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Consider a very simple representation of the before-trade Canadian and U.S. economies. Both countries produce only automobiles and food, according to the technology represented in the following production possibility frontiers: Assuming the working populations of Canada and the US is 25 and 250 respectively. a. Use well-labelled diagrams, show that Canada can gain from trade with the US. Carefully describe what will happen to Canadian production, employment, and wages after free trade with the US. Be careful to state your assumptions. b. Recognizing that the above model is a simplification of the real world, analyse the likely short- and long-run employment consequences of free trade with the US on Canadian employment and wages. c. Within four years of implementation of the Canada-US Free Trade Agreement (FTA) in 1989, employment in Canadian manufacturing dropped by 400,000. This shows that the FTA killed jobs." True or false? Explain.
a. The gains from trade can be illustrated using diagrams. In Figure 1, the pre-trade situation for Canada is depicted, and in Figure 2, the pre-trade situation for the United States is shown. The slope of the production possibility frontier represents the opportunity cost of producing the other commodity.
When both countries engage in trade, and Canada specializes in importing food and exporting cars, its production possibility frontier shifts from AB to CD. This movement indicates that Canada gains from trade as it can now consume outside of its own production possibility frontier. Trade allows Canadian consumers access to a greater variety of goods at lower prices. Assumptions for these gains from trade include identical production technology, constant costs of production, no transportation costs, and no trade barriers or international labor mobility.
b. In the short run, trade can lead to unemployment in specific sectors of the economy. Canadian workers who were previously employed in the production of cars or food may face unemployment if imports from the United States replace domestically made products. However, it is important to note that trade can also generate new jobs in the same or different sectors of the economy. While certain workers may experience job losses in the short term, others may find employment in the long term. Empirical evidence does not strongly support the notion that trade has a net negative impact on employment in the long run. Similarly, the effect of trade on wages is mixed, with some workers experiencing wage increases and others facing wage decreases.
c. The statement "Within four years of the FTA's implementation in 1989, employment in Canadian manufacturing fell by 400,000" is factually correct. However, it is misleading to attribute the job losses solely to the Free Trade Agreement (FTA). During the 1980s, several macroeconomic factors, such as the oil shock, recession, and high interest rates, adversely affected various Canadian industries, including manufacturing. These factors had already begun to harm Canadian manufacturing before the FTA was implemented. Thus, it is inaccurate to solely attribute the loss of manufacturing jobs in Canada to the FTA.
Trade brings gains through expanded consumption choices and lower prices. While trade may lead to short-term unemployment in specific sectors, it can also generate new jobs in the long term. Wage effects vary, with some workers experiencing increases and others facing decreases. When evaluating the impact of trade on employment and wages, it is crucial to consider various factors and not attribute all job losses solely to trade agreements. The 1989 FTA did coincide with a decline in Canadian manufacturing employment, but the broader economic context suggests that other factors were primarily responsible for these job losses.
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In which of the following situation(s) will owners who supply factors of production be most likely to earn economic rents? a. Highly elastic supply of the factor; highly elastic demand for the factor b. Highly elastic supply of the factor; highly inelas- tic demand for the factor c. Highly inelastic supply of the factor; highly inelastic demand for the factor
Owners who supply factors of production are most likely to earn economic rents in situations where the supply of the factor is highly inelastic while the demand for the factor is highly elastic. Therefore, the correct option is (b) highly elastic supply of the factor; highly inelastic demand for the factor.
Economic rent refers to the income earned by a factor of production that exceeds its opportunity cost. In other words, it is the surplus earned by owners of factors of production due to their scarcity or unique characteristics.
When the supply of a factor is highly elastic, it means that it can be easily substituted or increased in response to changes in its price. In such a scenario, the supply curve is more responsive to price changes, and the factor can be readily obtained or produced in larger quantities. As a result, the competition among suppliers increases, and their ability to earn economic rents decreases.
On the other hand, when the demand for a factor is highly inelastic, it means that the demand for the factor is not very responsive to changes in its price. This indicates that the factor is unique or specialized, and there are limited substitutes available. In such a situation, the factor becomes more valuable, and its owners can command higher prices or rents for supplying it.
Combining these two conditions, when the supply of the factor is highly elastic (easily substituted) and the demand for the factor is highly inelastic (limited substitutes), the owners of the factor have a relatively greater bargaining power. They can restrict the supply or charge higher prices, resulting in economic rents.
The situation where owners who supply factors of production are most likely to earn economic rents is when the supply of the factor is highly elastic, indicating ease of substitution, while the demand for the factor is highly inelastic, indicating limited substitutes and higher value.
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